No Felony Charges In 2009 Orange County Ponzi Scheme That Bilked $800 Million From Investors

It's been more than two years since the U.S. Securities and Exchange Commission (SEC) sued Medical Capital Holdings (MCH), the Tustin lender that was embroiled in a bizarre hospital-related Ponzi scheme that was extensively probed by the Weekly in 2009. MCH was created to purchase unpaid medical bills at a discount, and then return profits once the bills were collected. But according to the SEC's June 6, 2009 lawsuit against MCH, the company and its two directors, Joey Lampariello and Sidney Field, defrauded some 20,000 investors by diverting their cash into distinctly non-medical places.

But wait, it gets worse, according to the latest court-appointed receiver's update, which was first reported by the Orange County Register yesterday. "While investors in Medical Capital Holdings lost nearly $800 million, its principals were doing very well," the Register article states. "MedCap CEO Sidney M. Field drew $19.8 million . . . while President Joseph J. 'Joey' Lampariello got $5.39 million."

So far, the article says, the receiver has only been able to come up with $100 million for the investors, but pending lawsuits related to the SEC action will hopefully generate more cash. So given the huge amount of money stolen from investors, you'd think Lampariello and Field would already be rotting behind bars like Bernie Madoff, right?

Nope. No criminal charges have been filed against Field, and while his pal Lampariello isn't as lucky, he's only being charged with five misdemeanor counts of tax evasion, meaning that he may never even see the inside of a jail cell.

Award-winning investigative journalist Nick Schou is managing editor of OC Weekly. He is the author of Kill the Messenger: How the CIA’s Crack Cocaine Controversy Destroyed Journalist Gary Webb (Nation Books 2006), which provided the basis for the 2014 Focus Features release starring Jeremy Renner and the L.A. Times-bestseller Orange Sunshine: The Brotherhood of Eternal Love’s Quest to bring Peace, Love and Acid to the World, (Thomas Dunne 2009). He is also the author of The Weed Runners (2013) and Spooked: How the CIA Manipulates the Media and Hoodwinks Hollywood (2016).